Committee Reports > List of Committees > Dáil > 1938 > Committee of Public Accounts > Report - Appropriation Accounts 1936 - 1937

MIONTUAIRISC NA FINNEACHTA

(Minutes of Evidence)

Dé Céadaoin, 30adh Mí na Samhna, 1938.

Wednesday, 30th November, 1938.

The Committee sat at 11 a.m.

DEPUTY DILLON in the chair.

Mr. J. Maher (representing the Comptroller and Auditor-General), Mr. A. D. Codling and Mr. C. S. Almond (An Roinn Airgeadais) called and examined.

VOTE 65—ARMY.

Lieutenant-General P. MacMahon called and examined.

829. Chairman.—There is a note to this account by the Comptroller and Auditor-General, as follows:—

“During the year under review, a sum of over £1,000 was misappropriated by an officer of the forces, who was convicted of an offence in the civil courts and sentenced to a term of imprisonment. The loss was largely attributable to the non-observance of the regulations pertaining to the duties of imprest-holders and pay officers. The officer concerned, though not a duly appointed imprest-holder, was allowed to operate a particular account and to retain custody of large sums of cash. He frequently obtained imprests in excess of the needs of the Service, and the cash balance as shown in the account continued to increase until it exceeded £1,000 at the end of nine months, when the misappropriations were brought to light. Explanations had been obtained on a few occasions of the necessity for holding large cash balances, but they were accepted without verification, apparently, because of the prevailing uncertainty regarding the attendance of volunteers for training, and because it was deemed imperative that the pay officer should have in hand adequate funds to meet all claims for pay and allowances.

“The necessity for the exercise of constant supervision in connection with all matters affecting the safe custody of public funds is also exemplified in two minor cases of fraud which are brought to notice in the statement of losses appended to the account. In one, a reservist pay clerk, having access to both the cash and the payrolls, sought to conceal the theft of cash by increasing the sums shown as disbursed in the pay-roll by a corresponding amount. He was discharged nine months afterwards, the amount which had accrued to his credit being withheld to make good the loss. In the other case, a clerk in a quartermaster’s office was able to extract postal orders from the outgoing and incoming correspondence over a period of three months.”

Have you any observations to make, Mr. Maher, in regard to that note?

Mr. Maher.—The position is as stated in the Report of the Comptroller and Auditor-General. The loss is attributable to the non-observance of the regulations. We understand that the appointed imprest-holder delegated his duties and failed to carry out his instructions, as defined in the regulations, inasmuch as he never supervised the work of his deputy but signed all documents without question and did not interest himself in the correspondence relating to the account. The officer concerned appears to have had complete control of the particular account and to have requisitioned the money from head office during the whole of the period. He signed all weekly and monthly returns on behalf of the imprest-holder and retained custody of all moneys. Apparently, he was subject to no supervision. In other words, the regulations laid down in 1930 and 1936 do not appear to have been adhered to.

830. Chairman.—Was it the imprest-holder himself or his deputy who was convicted of the embezzlement?

General MacMahon.—His deputy.

831. Chairman.—Was any disciplinary action taken against the imprest-holder? —The question of disciplinary action against the imprest-holder and some members of my staff is under discussion, both written and verbal, with the Department of Finance. The decision as to the exact amounts to be deducted from those concerned has not yet been arrived at, but I expect it will be arrived at very soon. The officer concerned will certainly be punished.

832. Deputy Keyes.—Will that punishment take the form of stoppage of increments?—In the case of the officer, it will be by way of deduction from pay, and, in the case of the civilians, it will probably be by way of stoppage of increments.

833. There appears to be no other way of recovering this sum of £1,000 than by stoppage of increments?—So far as the civil servants are concerned, that is so. In the case of the officer concerned, we can deduct from his pay whatever sum the Minister decides

834. That will apply only to such people as you can directly connect with the negligence involved in this transaction?— Undoubtedly.

835. Deputy McMenamin.—Is this imprest-holder still in that position?—No. He was changed immediately the fraud was discovered.

836. Is he in any position involving the control of cash?—No.

837. You will recall that some years ago we had a case in which money deposited by members of the Service with an officer was misappropriated?—I am afraid I do not remember that case.

Mr. Maher.—We have had several cases but not in recent years.

838. Deputy McMenamin.—In the case I refer to, an officer was appointed to receive savings from the men?

General MacMahon.—I remember that case.

839. Deputy McMenamin.—Should not that have put the Department on its guard?—That system was discontinued.

840. Here we have a case of an imprest-holders whose deputy is allowed to hold a large cash balance. That money could easily be got at at any moment?—Yes.

841. Chairman.—You may remember that in the Report of this Committee on the Appropriation Accounts for 1935-36, we had to direct the attention of your Department to misappropriations which had arisen from the practice of allowing soldiers’ pay to accumulate. Are you satisfied that adequate precautions are being taken in every division of your Department to prevent misappropriations of this kind occurring?—I am satisfied that the system in operation in the Department and the regulations governing the conduct of military personnel are as satisfactory as we can make them. You have, of course, to consider the human element, and a considerable portion of this loss is due to the fact that some of the personnel concerned were not entirely satisfactory. They did not carry out their instructions. Had they carried out their instructions, the loss would not have been nearly as great as it turned out to be.

842. We are very acutely conscious of the peculiar difficulties which you have to meet in maintaining strict discipline in these matters in dealing with the Army. Much of your personnel is rawly recruited and has to be under your directions for some time before it can reach the standards requisite for the handling of money. It does appear, however, that the recurrence, again and again, of misappropriations in the Department are calculated to create a very unfavourable impression?— On the other hand, these regulations are carefully gone into by the Department, and are also examined by the Department of Finance. Every regulation has to be countersigned by the Minister for Finance, and an endeavour is made to leave no loophole. We did discover, in connection with the case mentioned by Deputy McMenamin, that the system in question lent itself, to a certain extent, to fraud, and we immediately ceased to operate that system. These regulations can be examined by any authority, and it will have to be admitted that they are satisfactory. I do not see any way of making them more watertight.

843. While it is true that much of your personnel in the early stages must be semi-trained until they attain some experience in the Army, would it not be possible for the Army to ensure that the handling of cash would be exclusively reserved to the seasoned and tried members of the Army?—This particular officer was seasoned and tried. He was in the Army from 1922 and his superiors had the very highest opinion of him. There was not a single mark on his record until this incident took place.

844. Are you referring to the person to whom the imprest-holder delegated his authority?—I am referring to the deputy —the officer who was convicted of fraud. The imprest-holder had an equally good reputation. As far as the personnel in the Department, who failed to carry out their instructions fully, are concerned, we thought they were satisfactory until this thing arose.

845. You will understand that, while it is possible for us who have the advantage of discussing the matter with you, to understand the special difficulties that surround matters of this kind, the impression on the public, if it once gets into the public mind that the Army habitually misappropriates public funds, would be deplorable and would result in a very grave injustice to the vast majority of officers and men of the Army who are honourable men?—I understand that. The civilian and military members of the staff feel very strongly on the subject and every effort is being made to prevent anything of that kind recurring.

846. Deputy McMenamin.—Have you not an occasional check when there is any large amount of cash on hands?—To begin with, there should not be a large cash balance there. The instructions provide that there should not be a greater sum than 10 per cent. of the normal imprest and the civilian personnel in the Department have instructions to see that that sum is not exceeded. As to inspection——

847. I am referring to a check?—There is a check every week and a further check every month. The imprest-holder has to return his payrolls and give a full account of the money expended and the money on hands. At the end of the month, he has to repeat all that and to give a bank certificate as to the amount in the bank.

848. This was not detected owing to the fact that the actual imprest-holder did not do his duty to see whether that cash was in the safe or not?—The members of my staff drew attention to the fact that he held an excessive amount of money. He gave a plausible excuse, to the effect that he had to pay reservists up for training and that he required money for a number of volunteers up for weekend camps. The explanation in the beginning was satisfactory but, unfortunately, when the amount increased, the same people did not draw the attention of their superior officers to the fact that the amount in hand was increasing. Had that been done their responsibility would have ended and the responsible officer would have investigated the matter right away.

849. Is an incident of that kind, where it is reported that an excessive amount is on hands, brought to your notice?—It was not reported to me. They wrote direct to the officer dealing with the matter and the officer gave an explanation which they regarded as satisfactory. It should have been reported to the head of the section. If he had been dealing with it he would have reported to me.

850. Chairman.—The imprest officer was receiving this money and passing on to his delegate. To whom did the imprest officer account for the monthly condition of his balance?—The officer that was convicted of the theft accounted to the Department in the name of the imprest-holder. The cheques were all made payable to the imprest-holder and this officer, who deputised for the imprest-holder, requisitioned the cash in the name of the imprest-holder and accounted for it in his name. He signed himself “Captain Smith, for imprest-holder.”

851. Do you look upon that as the normal procedure?—It is inevitable that that should happen now and again. The imprest officer may get ill or he may go on leave now and again. It may happen occasionally.

852. Technically, to whom did the imprest officer account?—The imprest officer had to account to me as Accounting Officer for the Vote.

853. He would be directly under your supervision?—That is correct.

854. It appears that the evil began to accumulate as from the month of May. The balance which, up to that time, had fluctuated, began steadily to grow. You have it growing from £279 in June to £607 in July, £712 in August, £921 in September, £974 in October, and £1,100 in November. It does occur to me that that would create the impression upon the mind of an experienced accountant that there was something amiss?—The cash was inspected in April of that year and everything was found in order. The officer in charge of that particular imprest, a civil servant, drew attention to some of the amounts and said that he thought they were excessive. He asked for an explanation. He got that explanation and he accepted it. He did not draw the attention of the head of the section to the matter. When the amount increased, he still failed to draw the attention of the head of the section to it. Had he done so, the head of the section would have taken action.

855. I know the administrative difficulties, but I should like to be told this. If you appoint an imprest officer and authorise him to draw money, you place your confidence in him and choose him because he is a person in whom you have confidence. He may delegate his duties to an officer in whom he has confidence, but that is not your trust directly. If your imprest officer goes on leave or falls ill, is it not desirable, or is it practicable, for you to appoint a substitute imprest officer, during the absence of your own man?—To start off with, I do not select the officer though I have to approve him. I can say: “I am not satisfied with this officer,” but I have no authority to select him. I have authority merely to approve of him or to say that I do not consider him a suitable officer. The imprest-holder would realise the responsibility of having to appoint a deputy and of having to accept responsibility for that deputy. He would know the officers in his district better than I would know them and consequently would select a suitable officer. In this particular case, the officer who was appointed was regarded as one of the most reliable officers in the particular command. If his name had been submitted to me as imprest-holder, I would certainly have accepted him as imprest-holder.

856. That satisfactorily answers my question. A point I should like you to consider is this. In the event of an imprest-holder approved by you appointing a delegate, and then falling ill or going on leave, should not a new imprest-holder, who would supervise his predecessor’s delegates, whoever they might be, be appointed with your approval during the absence of the original imprest-holder?—In fact, I am told such a man is appointed to act for a man when he is away. If I know anything against him, or if I think he is not a suitable officer, I have an opportunity of so informing the Quartermaster-General. I have that opportunity at the moment.

857. Deputy Smith.—Are there any cases on record in which officers’ names were submitted to you for this position and were rejected by you?—Yes. On at least two occasions I rejected names submitted to me.

858. Deputy McMenamin.—Was this officer, the imprest-holder, reduced in rank by way of penalty?—The case of the civilian members of the staff and of the officer has not yet been brought to a conclusion, but I think that the punishment in each case will be simply a fine of a certain amount.

859. Mr. Maher.—With regard to the second paragraph of the note, particulars will be found on page 218 of the accounts. In the first case, the fraud was facilitated by a reserve pay clerk inserting the figure 1 in the shillings column, thereby increasing the amount due to each man by 10/-. In the second case, postal orders for amounts varying from £1 to 1/-, and totalling £5 4s. 4d., were cashed illegally during the months of January, February and March, 1935. The orders were pilfered from the incoming and outgoing post. The object of this paragraph is to emphasise what has just been discussed in the first paragraph, that is. the necessity for careful supervision in all matters relating to pay and money.

860. Deputy McMenamin.—Was it the duty of the man who pilfered these packets to receive postal orders?—He was an N.C.O. and he had no authority to handle these postal orders at all. Again, it was a case of an officer not doing his duty, but delegating it to a subordinate to whom he should not have delegated it.

861. How did it come about that these things came to his hand? Was there not somebody else responsible for receiving them?—His immediate superior officer was responsible for the orders and should not have allowed his subordinate to handle them. He delegated duties to the N.C.O. which he should not have given to him.

862. Has the N.C.O. been called to account?—Yes.

863. Chairman.—I notice that the reservist pay clerk who was convicted of theft was retained in the Army for nine months after his theft. Do you think that a prudent course to pursue?—At the moment I cannot say how long he was retained, but I should like to explain that so far as the punishment of officers, N.C.Os. and men is concerned the matter is not in my hands. It is a matter for the Adjutant-General. He deals with them usually through a court-martial and if an officer, N.C.O. or man is court-martialled, the Adjutant-General or the Minister can reduce the punishment. He cannot, however, increase it. The man involved cannot be brought before an outside court if he has been court-martialled, except in the case of a very major crime.

864. Still, I suggest that in the circumstances, the ultimate discretion in all such matters would lie with the Minister whose Department you represent, and it does appear to me, and the Committee will probably agree with me, that, knowing as we do that the Army as a whole abhor these transactions as much as we do, it is very necessary to make it quite clear that gentlemen who rob the pay roll or funds of the Army will not be kept on in the Army, even on sufferance, for one month, much less for nine months.

865. Deputy Keyes.—Was this man tried in a civil court?—No, by court-martial.

866. So that he was retained for nine months subsequent to his guilt being determined?—Yes, that may happen. A court-martial, or even a Minister might decide that.

867. Chairman.—Pause there for a moment, because I know that you have not got the note of this case before you. There may, of course, have been some delay during which inquiries were proceeding as to the exact nature of his offence?—I think we are mixing two cases—the case of the postal orders and the case of a reservist assisting an officer altering the figure on the pay roll. In that case, there was considerable delay because we had to get in touch with all the reservists concerned. A reservist is supposed to give his address, but very often we find, when we apply at that address, that he has gone somewhere else looking for work, and a certain time elapses. In this case, a very considerable time elapsed before we were able to investigate the case fully. I think we are mixing the postal orders case with the case of the alterations in the pay roll.

868. It is the case of the reservist I am referring to. The delay was possibly due to the fact that you had to get in touch with a number of people whose addresses were uncertain and it was during these inquiries that the fellow remained on the Force pending the completion of your investigation?—In actual fact, that particular reservist had an address in Belfast. We tried to get him to turn up at the Court of Inquiry, but he would not come, and we had no jurisdiction over him. He was discharged. There was delay, but it was delay which was unavoidable. It would be very wrong to discharge a man before the matter was brought to a conclusion because we hoped to bring him up as a reservist and deal with him.

869. Deputy McMenamin.—Was he suspended in the interregnum?—A reservist only comes up for one month in the year and the fraud was not discovered until he was demobilised. We tried to get him up when we were investigating the matter, but he did not come. When we found that he did not attend, we discharged him from the Reserve.

Report of the Comptroller and Auditor-General:—

Sub-head A (2)—Resignation, Retirement and Discharge Gratuities.

“In the course of investigation of the misappropriation of motor tyres, which occurred over a period of six months at a mechanical transport depot, it became apparent that a systematic scheme of theft of mechanical transport stores had been operated for a considerable time previously, but the full extent of the losses could not be definitely ascertained. A member of the Forces who had charge of the store records admitted in evidence that on several occasions he falsified the store documents and forged various signatures, and no doubt of his complicity in the thefts existed. As the medical authorities certified that he was unfit to undergo trial by court-martial, he was discharged from the Forces as medically unfit after a period of treatment in hospital; and he was granted 21 days’ pre-discharge leave with pay and a discharge gratuity. On inquiring whether it was the normal procedure to pay a gratuity in such circumstances, I was informed that the only cause for which a gratuity could be withheld is misconduct, and on considering this man’s total service and general record, it was thought that discharge on such a ground would be inequitable.

“I have communicated with the Accounting Officer regarding other cases in which the payment of discharge gratuities did not appear to be consistent with the regulations.”

870. Chairman.—If a man who falsifies store documents, forges signatures and is involved in theft has not been guilty of misconduct, who is guilty of misconduct in the Army?—I have to put it to you that the Adjutant-General is advised by a qualified legal officer. So far as members of the Force are concerned, he must act in many cases as a judge, and if a man is brought before a judge tomorrow, the judge may be perfectly satisfied that he is guilty, but unless he actually convicts him, the man is still innocent.

871. But this man admitted in evidence that he had falsified store documents and forged signatures?—He admitted that he altered documents, but he did not admit theft.

872. What was the nature of the evidence which this man was giving when he admitted falsification of documents and forgery of signatures?—A Court of Inquiry was held to investigate the matter.

873. Was this man on oath before it? —He was, and he admitted that he had falsified documents, but denied that he had stolen anything.

874. Deputy McMenamin.—The note says:—

“Admitted in evidence that on several occasions he falsified store documents and forged various signatures and no doubt of his complicity in the thefts existed.”

875. Chairman.—The General distinguishes between convicting a man without due process of law and trial and acting on a man’s own admission. All the man admitted was that he falsified store documents and forged signatures. He did not admit theft?—In this matter, the Accounting Officer has no control whatever in disciplinary matters. The Minister, except in some very grave case, does not come into it. He leaves matters like that to the Adjutant-General, who is advised by a competent legal officer.

876. Deputy Childers.—In the interests of the discipline of the Army, was it not possible for this man to be placed in hospital until sufficiently cured to undergo trial and have the case, not only admitted by him personally, but proved legally? For what reason was it not proved legally, but left as a matter of his own admission, so that nothing could be done in regard to taking action against him and making an example of him to the Army?—If we acted as the Deputy suggests, we might find ourselves in difficulties. Three medical officers had said that this man should be discharged from the Force, and if the Accounting Officer requested the Adjutant-General to retain him in hospital until he was fit to stand court martial, he might be in hospital for six months and be acquitted at the court-martial and the Comptroller and Auditor-General would inquire from me why the State had to pay this man pay and subsistence allowances for that period.

877. How long had his health been known to be such that he could, in the ordinary course, be said to be unfit to do his duties?—That is a question I could not answer because as in the case of disciplinary matters with the Adjutant-General, we have to accept the medical officer’s report as to whether a man is fit or unfit. I have no authority to question the medical authority. If he says a man is fit, I have to accept it.

878. Deputy Keyes.—Notwithstanding the fact that, technically, the man was not proven guilty of actual robbery of the stores, the admissions he made were, in my view, sufficient to warrant his being put away without the very generous treatment accorded to him, particularly in the light of the action taken with reference to the case in the first paragraph, in which people who could not be directly associated with the offence have been reduced and suspension of increments applied to them. They were people who were far removed from the actual officer who was guilty. In this case, we find a gentleman who makes a frank admission sent away with the most generous treatment in the form of pre-discharge leave and gratuity which, to my mind, is an encouragement to other people to do likewise.

879. Deputy Childers.—Is there a statutory obligation on the Army authorities to give gratuities and pre-discharge leave, or is it merely a tradition?—There is a regulation under which it is mandatory upon the Minister, unless he alters it. With regard to the other point, the people to whom Deputy Keyes has referred are civilians who are not governed by the Army Act. Officers, N.C.O.s and men are covered by the Act, and by the regulations made under it. Even the Minister is bound to adhere to the terms of the regulation until he alters the regulation. He has no option in the matter.

880. Chairman.—Under the Army Act, and the regulations made thereunder, I take it that it would have been open to the Minister to discharge from the Army in ignomy any man who swore that he falsified store documents and committed the felony of forgery?—I submit that the Minister has not any power to do that. The Minister has the power to set the machinery in operation. He could have the man court-maritalled, and if the man were found guilty, he could then take action.

881. So that no matter what admissions a member of the Army makes, unless he is brought before a court-martial and there instructed to plead, and until the finding by the court-martial is reported to the Minister, the Minister’s hands are tied?—That is so. If the soldier likes he can, in minor matters, be dealt with by his commanding officer, but in all cases the soldier is entitled to be court-martialled. He has that power under the Act, and the Minister has no power to take it from him.

882. Your difficulty in this case was that the medical officers forbade a court-martial. You knew the man had been guilty, by his own admission, of gross misconduct. When you found that you could not apply the requisite regulation to permit of his being adequately dealt with, the officer responsible felt that the best thing to do was to get him out of the Army?—My hands in a matter like that are completely tied.

883. He got no benefit by way of gratuity or pre-discharge leave which he was not bound to get under the regulations? —That is so.

884. Deputy Keyes.—He got what he would have been entitled to get if discharged on medical grounds, and if he had been guilty of no offence?—The same.

885. Chairman.—The last paragraph in the note of the Comptroller and Auditor-General to this sub-head reads:

“I have communicated with the Accounting Officer regarding other cases in which the payment of discharge gratuities did not appear to be consistent with the regulations.”

Mr. Maher.—We noticed a number of cases in which gratuities had been paid to members of the Forces whose retention in the Army was apparently undesirable, and these were “discharged on the determination of the Minister.” This follows pretty closely on the discussion which has just taken place. We understand that when a member of the Forces is discharged on the determination of the Minister, and not for misconduct or as a result of conviction, he is entitled to his gratuity. We noticed that while, apparently, misconduct of a minor or major nature was inherent in some of these discharges, that the reason for the discharge was the Minister’s determination. Therefore, that entitled them, we understand, to gratuities varying from £11 to £3.

886. Chairman.—The position being that the Minister has a discretion simply to dismiss a man?

General MacMahon.—That is so.

887. Then, under the regulations, that man gets a pre-discharge leave and gratuity?—Yes, unless he is guilty of misconduct.

888. But the Minister cannot discharge him and withhold his pre-discharge leave or his gratuity?—He could not at that particular period, but he can now.

889. You have altered the regulations? —Yes, and he can discharge him now.

890. And deprive him of the benefits which were given to this man whose case we were discussing a few moments ago? —Yes.

891. For no reason stated?—In the case of an N.C.O., he can discharge him without giving a reason.

892. I must say that, in the course of your evidence before this Committee, what appeared to me prima facie to be a scandal in regard to this person who said that he forged signatures and falsified store documents, your evidence converted me to the Department’s view that the course they pursued was right and that he ought to have been allowed trial but, having converted me to your point of view, you now shock me by telling me that you have changed your mind?—The Army Act was amended in 1937 following the passing of the Constitution. We took advantage of that to amend the Act to give us this power. It would have been impossible, in the case of this particular soldier, to amend the regulation. Again, with regard to the statement made by the Comptroller and Auditor-General, I would like to say that we had a thorough stocktaking made some few months before this loss occurred, and that everything was then in order. I would also like to add that the Quartermaster-General and the Director of Transport investigated this matter very thoroughly and satisfied themselves that the only losses that occurred were those that were discovered. This later statement made it perfectly clear that the only frauds were the particular ones discovered.

893. Chairman.—And that, in the opinion of the Department, the full extent of the losses had been definitely ascertained?—Yes.

894. Was the Comptroller and Auditor-General notified of that later finding?— The files were available to him at the time.

895. I would like to know from Mr. Maher if the Comptroller and Auditor-General got any notification of the later finding of the Quartermaster-General, that the fuil extent of the losses had been ascertained?

896. Mr. Maher.—Not specifically, but we accept General MacMahon’s explanation, of course.

897. I take it that the Quartermaster-General would be well advised, if subsequent facts come to light, which give him reason to correct any information that may have already reached the Comptroller and Auditor-General, to take the earliest opportunity of advising the Comptroller and Auditor-General of any additional facts that do come to light?

898. General MacMahon.—In actual fact, this report was on the file before the matter was reported at all. We did not know at that particular stage that the Comptroller and Auditor-General was going to raise it.

899. Mr. Maher.—The Comptroller and Auditor-General queried the Accounting Officer in November, 1937, on this point. In that query he said:

“In the course of the investigation of these thefts, the Court of Inquiry became satisfied that a systematic scheme of theft of all types of motor spares and fittings had been going on for a number of years.”

That was the query which the Comptroller and Auditor-General put, and in the Accounting Officer’s reply the statement was not contradicted. That is the reason for the Comptroller and Auditor-General’s note in the report.

General MacMahon.—In connection with the gratuity, I am afraid I did not explain it very well. The gratuity at that particular period was paid by the imprest-holder. Since then a pensions scheme for the Army has been introduced. That provides that gratuities will be paid by the Accounting Officer on the approval of the Minister. That particular Act authorises the Minister either to refuse or to grant a pension or a gratuity. It gives him an absolute discretion in the matter.

900. Chairman.—I think that we can now pass to sub-head G—Lodging. Subsistence and Other Allowances. The Comptroller and Auditor-General has the following note to this sub-head:—

“With reference to the comments of the Committee of Public Accounts for the Committee of Public Accounts in paragraph 7 of its report on the accounts for the year 1933-34, regarding the admissibility of payments made to an officer in respect of the period prior to the date of the Minister’s Order determining him to be a married’ officer, the Department of Defence has since obtained legal advice to the effect that the regulations did not empower the the Minister to give retrospective effect to his decision. The Department of Finance has now given its covering sanction for the charge to public funds of the irregular payments which amount to £127 10s. 0d.

Is that regular procedure, Mr. Maher, when extra-statutory payments are made to have them regularised by the consent of the Department of Finance, and not by the introduction of a Supplementary Estimate in the Dáil?

Mr. Maher.—It depends on the recommendation of the Committee. This matter was already before the Committee in its examination of the accounts for the year 1933-34. The Comptroller and Auditor-General now brings to the notice of the Committee that the Attorney-General has advised that the Minister was not empowered to act as he did. The Department of Finance has now sanctioned the overpayment.

901. Chairman.—The Committee, I think, would like to have the view of the Department of Finance on this matter. Is it the view of the Department of Finance that no Supplementary Estimate was requisite in this case?

Mr. Almond.—Yes. We considered that the overpayment was due to a genuine misinterpretation of the regulations by the Minister for Defence and the secretariat of his Department. It turned on the legal interpretation of a phrase in the regulations. It was only when the Department got legal opinion that it was discovered that there had been a misinterpretation of the regulations.

902. I take it that the Department of Finance will agree that normally, when extra-statutory payments are made, the correct procedure would be to introduce a Supplementary Estimate in the Dáil? —The payment was not extra-statutory in the sense of being outside the Acts governing the Army. It was, however, outside the Regulations made under those Acts. The Regulations are binding on the Army, and if the Department of Defence wish to go outside of them in any particular instance, they have to seek the authority of the Department of Finance.

903. And make a new regulation?— Not necessarily. There may be a particular case just outside the regulations which they wish to treat exceptionally.

904. And the Act provides a joint discretion between the Army and the Department of Finance to go outside a regulation made under the Principal Act? —Exactly. From the financial point of view, a regulation is really only a delegated authority by the Minister for Finance. Instead of sanctioning every particular item of expenditure, the Minister for Finance approves of a Defence Force Regulation which enables the Department of Defence to incur expenditure within the regulation. If, for any reason, it is necessary to go outside that regulation, they come to the Department of Finance for specific authority.

905. In fact, if they had anticipated this case they could have made new regulations to cover this side of the matter? —They could.

906. Was it the intention to make the regulations retrospective?—New regulations were not wanted.

907. Your sanction covers this particular case?—Yes. I do not think it will recur, because the regulations will be followed in respect of that particular matter in future. Usually the Department of Defence puts a specific case to us which is outside the regulations and in most cases it is accompied by an assurance that amending regulations will be prepared to cover future cases. In many cases our specific authority is to cover the interval between the application and the making of new regulations.

908. Chairman.—Now we come to sub-head 85, which reads:—

“It has been the practice to mobilise members of the Volunteer Force for participation in ceremonial parades held on two special occasions each year. In connection with the parades organised for one of those occasions in 1936, arrangements were made for the conveyance of a large number of volunteers, all available Army transport being utilised for this purpose and over £1,100 expended on the provision of public conveyance, but less than 40 per cent. of those called availed of the facilities afforded. A large proportion of the expenditure incurred in this instance could have been avoided if prior information regarding the numbers reporting had been available, as the arrangements based on the estimate of attendances resulted in duplication of travelling facilities, payment for services in excess of requirements, and the uneconomical use of Army transport. As somewhat similar conditions have obtained on other occasions, I have asked the Accounting Officer for his views regarding the possibility of devising means to secure more effective control over expenditure on this service.”

Have you, Mr. Maher, received the Accounting Officer’s views on that subject?

Mr. Maher.—Yes, Sir, the Accounting Officer sent a reply to us and in that reply he emphasised the difficulty of estimating the number of volunteers who would attend for parades. That is the difficulty. He has also notified us that the officers concerned have been instructed that the greatest care must be taken so that the estimate of the attendance of volunteers will be as reliable as possible.

909. You are satisfied that very careful precautions will be taken?—We appreciate that difficulty. They have to estimate as to the actual number who will attend. We are satisfied that they have taken special precautions to reduce the expenditure.

910. The matter is receiving your attention, General MacMahon?—Yes, Sir, it is.

911. Chairman.—Sub-head K, paragraph 86, with reference to Provisions and Allowances, reads:—

“Statements have been furnished to me showing the cost of production of bread at the Curragh Bakery, and of meat at the Dublin and Curragh Abattoirs. The unit costs are as follows:—

“The increase in the unit cost of bread was mainly due to a rise in the price of flour.

“The average price of cattle purchased for the Dublin and Curragh areas was £15 9s 9d. and £13 8s. 6d. per head as compared with £14 5s. 11d. and £12 19s. 0d., respectively, in the previous year, while the average production of beef per head was 779 lb. and 708 lb., respectively, as compared with 850 lb. and 745 lb.”

Mr. Maher.—That is the annual statement which the Comptroller and Auditor-General includes in his report for the information of the Committee.

Chairman.—There is nothing very remarkable in that report except the price of bread of which we are painfully aware.

912. Now we come to paragraph 87, on clothing and equipment. The paragraph reads:—

“The system of purchase by competitive tender was departed from during the year with the approval of the Department of Finance in order to reserve to the Department of Lands (Gaeltacht Services) contracts for the supply of certain articles of clothing for the Army. With regard to shirting, it was decided to reserve contracts up to three-fifths of the requirements for a period of three years, and those placed in the year involved a preference of 37½ per cent. over the lowest competitive tender, the actual amount of the preference paid on deliveries up to 31st March last being £640. With regard to socks, a contract to meet the greater part of the Army requirements for the year under review was placed at a price 43 per cent. in excess of the lowest competitive tender for socks of standard Army pattern, the amount of the preference payable on this contract being approximately £900.”

Deputy Childers.—Does this refer to tenders from abroad, or only to Irish tenders?

General MacMahon.—It is for tenders for Irish manufactured goods only.

913. Deputy McMenamin.—Does this apply to the Gaeltacht Department exclusively?—Yes, that is so.

Then it amounts to a subsidy of £900 to the Gaeltacht, is not that so?—So far as I am concerned I think it is a question of policy.

914. Chairman.—Yes, that is so. With further reference to the question put by Deputy Childers, am I to understand that no quotations from Great Britain or abroad are included in the reference—that it refers to quotations from Irish manufacturers only?—That is correct.

915. We come now to sub-head S, paragraph 88, which reads:—

“Sanction was obtained in 1933 for the expenditure of £1,700 on the purchase of materials for the re-construction of a rifle range at a Command Headquarters, and it was increased in 1936 to cover the total amount expended on materials, which was approximately £2,200. The construction of this range had been regarded as a matter of urgency, in view of the cost of transporting troops in training at this centre to and from the available ranges in the adjoining Command, which was estimated to amount to more than £300 a year. These annual charges continue to be incurred as the range has not yet been made available, but I am informed that it is anticipated that the completion of the work will be undertaken during the present year.”

Has that range yet been completed?— It has just been completed Sir.

916. And so this annual charge will not recur in future?—Yes that is so.

917. Now we come to sub-head T— Military Lands; paragraph 89 reads:—

The charge to this sub-head includes an annual payment of £104 1s. 2d. in respect of the right granted in perpetuity under a deed dated 20th July, 1809, to exercise troops over an area of about 120 statute acres, and a further annual payment of £120, in pursuance of the occupation in 1918 of about 12 statute acres of the same lands by the British Air Council for the purpose of an aerodrome. Though the aerodrome lands are still used for the purpose of military aviation, no written agreement exists, and the Department is not entitled to charge landing fees to civil aviators to whom the usual facilities are afforded, or to claim an abatement of the rent or other compensation in respect of certain encroachments. It is, I understand, at present merely in the position of a licensee of the aerodrome, as the authority under which the use of these lands for aviation purposes was originally derived does not now apply in this country.

918. Have you, Mr. Maher, any observations to make on that?

Mr. Maher.—I understand that the law officers take the view that the present position regarding aerodrome lands is not satisfactory and they advise that a definite agreement should be arranged if the Department of Defence wishes to continue in occupation of thes lands. We think that the Department should be in a position to collect fees.

919. Where is this land?

General MacMahon.—In Fermoy; the aerodrome is in Fermoy and until the policy with regard to aviation at Fermoy is definitely decided, we think it better to carry on as we are. If we attempt to get the fees to which Mr. Maher refers, the rent will go up and we do not want to pay any increased rent until we know the actual use to be made of this place in the future. I think this matter will be decided in the next few months.

920. Chairman.—With reference to sub-head Z. Appropriations-in-Aid, paragraph 90 reads:—

“With reference to the receipts from lettings of Army lands, which amounted to £3,569 9s. 9d. in the year of account, an inventory of lands and buildings in the charge of the Department showing the terms on which the properties are held, and the use to which they are put, is not at present available, but I am informed that it is in course of preparation. Arrangements are also being made to carry out a regular periodical survey of those properties, as this work has so far been done only on a very limited scale. In this connection it is pointed out that, with the exception of the Curragh. the general control of barrack premises and minor appurtenant lands is vested in the Office of Public Works, which holds the title deeds and discharges any rent payable.”

Are you, General MacMahon, preparing to carry out the necessary survey?—We are, Sir, but we are not getting on as fast as we would like, due to the fact that we lost a few of our engineers recently. One or two of them resigned, and one or two of them had to be discharged on the grounds of ill-health. In addition, the engineering personnel got further duties with reference to the taking over of the ports. We have advertised for engineers, and we are getting further engineers.

921. Has any decision been taken as to whether these barrack premises and minor appurtenant lands are to vest in the Department of Defence, or are they to continue vested in the Office of Public Works?—No definite decision has yet been taken.

922. We have been bothered with a rather similar point in relation to the Board of Works, who have a number of other lands vested in them. It occurs to me that if the appropriate Departments were made responsible for their own premises and appurtenant lands it would be easier to get these properties straightened out?—I think it is the intention that we should take over these lands, but there has been no definite decision.

923. In think I might direct your attention to the comments by this Committee with regard to public works in the Report of the Public Accounts Committee. I think you would find it relevant. I understand it has not yet been published. This refers to the Board of Works Vote in general. There is some relevant material in the report which we are at present considering.

924. With regard to assistance to civil aviation, paragraph 91 reads:—

“In addition to the technical duties pertaining to civil aviation performed by the Army Air Corps on behalf of the Department of Industry and Commerce under the arrangement sanctioned in 1934, various services have been rendered in connection with the establishment of cross-channel and trans-Atlantic air services and public aerodromes. No decision has yet been come to regarding the manner of accounting for the cost of these services, and most of the expenditure so far incurred has been charged to a suspense account.”

Have you anything further to tell us about that matter, Mr. Maher?

Mr. Maher.—Additional expenditure outside the 1934 arrangement has been incurred in connection with the Dublin airport and for trans-Atlantic services, but we understand that no decision as to the incidence of these charges has as yet been arrived at.

General MacMahon.—Yes, the whole position is well known to the Department of Finance and they have not as yet given us any directions.

925. Has the Department of Finance anything to tell us about this?

Mr. Almond.—It is purely an accounting question. It is merely a question as to whether the cost should be borne on the Army Vote or on the Vote for the Transport and Meteorological services. There is not a large amount of money involved. We felt that we might wait for some time until we saw what developments would occur. Some of the Army officers may be transferred to the civil side, and there may be certain other developments which will affect the position. We shall probably give a decision in the matter very shortly.

926. Chairman.—The matter at the moment is on the long finger?

Mr. Almond.—We can bring it to a conclusion at any time if it is necessary to clear the suspense account.

927. Chairman.—All that is necessary is that the finger will not be too long.

Mr. Almond.—Very good, Sir.

928. Paragraph 92 of Report of Comptroller and Auditor-General:—

“With reference to the comments of the Committee of Public Accounts in paragraph 11 of its report on the accounts for the year 1933-34 regarding the control of articles of clothing and equipment on issue to members of the Volunteer Force, sums amounting to approximately £160 are shown in the Statement of Losses as written off in respect of the loss of articles of clothing which could not be recovered from the volunteers who had resigned or had been discharged.

“Further loss is involved in the wearing of articles of uniform on unauthorised occasions, and the enforcement of the regulations which prohibit this practice gives rise to considerable difficulty. During the past few years it has been found necessary to issue articles of kit, particularly boots, to a large proportion of the volunteers who reported for parades, to replace similar articles which had been rendered unfit for service by irregular use. Charges are raised in respect of those replacement issues— they amounted to £433 in connection with the special parades held in 1937— and they are recoverable by deduction from the pay and allowances accruing to the credit of volunteers who attend annual training, but in the case of those who do not attend it is difficult to effect recovery.

Chairman.—Have you any suggestions on that, Mr. Maher?

Mr. Maher.—No, the losses result from the system of permitting volunteers to retain those articles.

General MacMahon.—I think the Minister has under consideration an alteration in the system, and, if he puts it into effect—I think he will—we will not have this type of loss in the future.

929. Paragraph 92 continued:—

“In connection with the purchase of uniforms for the Army, quantities of articles were acquired from time to time in sizes for which there was very little demand. A large stock of these unserviceable sizes had accumulated in Central Stores, and it was decided to dispose of part of it, a sufficient supply being retained to meet possible demands for some years to come. The loss involved in the disposal of this stock was approximately £2,200, and in view of the possibility of further loss arising from the purchase of too large a supply of articles of clothing in sizes which are not in normal demand, I have communicated with the Accounting Officer on the matter.”

Chairman.—Have steps been taken to regulate that difficulty, General?—I would like to explain that practically all these stocks date back to 1926-27, when we had an Army more than twice as big as the present Army and when you had to have a large number of uniforms of varying sizes. Since the Army has been reduced in numbers, the recruiting officers have selected recruits more carefully and the necessity for getting very small uniforms has not arisen. I do not think this difficulty will arise again.

930. I am interested in the drapery trade and I assure you that every draper experiences exactly the same difficulty. That is a matter which skilful buying ought to avoid. It is a thing to watch? —I think our system of purchasing has improved very much within the last few years and the danger of this is not likely to arise again.

931. Paragraph 92 continued:—

“Final arrangements have not yet been made for the disposal of the surplus stocks of Barrack Service Stores, which were the subject of comment in reports of previous years, but I understand that this matter is engaging the attention of the Department.”

Chairman.—I understand this matter is engaging the attention of the Department. What is the nature of the various Barrack Stores?—Delph of various kinds.

932. You could make your fortune on that, because the price of delph has gone up considerably?—The articles include bowls. pepper casters, dishes, jugs, sprinklers, choppers, cups, moulds, etc.

933. If you held an auction of sugar bowls you would do very well indeed. Honestly, if you want to get rid of any bulk of this material, if the crockery dealers of Dublin or any part of the country were asked to tender for them I believe a great many would do so. Do they all carry the Army stamp?—Yes, they do; that is the difficulty. We give every Department an opportunity of purchasing anything they require, and we auction the balance.

934. I see you have 2,500 coffee saucers and you have 15,000 broom handles. You could make your fortune on these?—These have accumulated since 1922.

935. As for mop handles, they are worth their weight in gold, and you have 7,000 of them. Much of this stuff ought to be saleable. Have you made any endeavours to sell?—None whatever. We contemplate a public auction.

936. May I suggest that steps be taken to give adequate publicity to the trade, or else you may have two or three Jew dealers?—I will see that it is well advertised.

937. Paragraph 93 of Report of Comptroller and Auditor-General:—

“Losses written off during the year are detailed in a statement appended to the account. The total is made up of—

The latter figure shows a very considerable reduction as compared with that of the previous year, which amounted to £14,896 0s. 5d.”

938. Chairman.—Have you any observations to make on that, Mr. Maher?

Mr. Maher.—This is an annual statement which is included in the Auditor’s report.

939. Chairman.—It is very satisfactory to notice that the second item is reduced.

General MacMahon.—I am afraid we cannot take credit for that. It is due to the fact that aeroplanes had to be written off in the previous year.

940. Chairman.—With regard to sub-head A.1., military educational course abroad for specially selected officers, where are those educational courses principally held?—England, principally. We have two officers in America at the moment; all the others are in England.

941. With regard to sub-head P, warlike stores, how did the expense of warlike stores fall so low in view of the appropriation?—It was impossible to get the equipment we ordered.

942. Is it that people did not deliver the stuff?—Yes, they were so busy owing to the re-armament drive in England.

943. Deputy McMenamin.—Are all your purchases made by contract by the Department?—Yes.

944. They are not made through intermediaries?—A number of purchases are made through the British Government, but apart from that. the purchases are direct with the supplier.

945. The manufacturers?—Yes.

946. Chairman.—What sort of purchases are made through the British Government?—The new Bren gun, for instance—guns of various types. The reason we purchase from the British Government is this, that the guns during manufacture are inspected by their experts and we have their guarantee.

947. On sub-head R, fuel, light and water in kind and fuel oils, there is a large excess. Is there any special reason for it? The note simply says that the cost of requirements was underestimated. It is a rather substantial under-estimation? — We estimated at 3½d and it actually cost 4d.

948. Do you mean 4d. a man?—We estimated that we could do it at 3½d. and it worked out at 4d. per man; we underestimated.

949. You estimate the cost of fuel, light and water in kind and fuel oils on a per capita basis?—That is correct.

950. Is there any explanation why your estimate was one halfpenny wrong per capita?—I suppose the cost of some of the articles had increased.

951. What articles? There has been no remarkable change in the cost of coal, light or water?—I think it may be due to the fact that at the Curragh we supplied our own electricity until recently and then we got the Electricity Supply Board to instal their supply and I suppose in the initial stages it may have been more expensive. That may possibly be the explanation, but I am not quite certain.

952. I am very reluctant to trouble you for a note on these matters, but I do not know that the cost of coal, light or water materially increased. If it is not too much trouble, I would be obliged if you will look into that matter and let us have a note* accounting for an increase of £7,680 19s. 7d.?—Yes. I will do that.

953. Chairman.—Sub-head T (3) covers the Volunteer Reserve Force in addition to the old Reserve?—Yes, Sir.

954. Are its numbers increasing?—Its numbers on paper are about the same, but we did not get as many for annual training as we anticipated.

955. When they do not come for annual training, do you simply drop them out of the force, or what do you do?—We do not drop them off until we are quite satisfied that they are never likely to make good volunteers.

956. Do you send for them or do you reprimand them for their failure to present themselves for training?—We have no power to take disciplinary action against a volunteer who does not turn up for annual training. We can, of course, discharge him, but we simply do not give him the grant he would get if he came up.

957. He is a person liable to be called upon in the event of war?—Yes.

958. Deputy Corry.—Is not that largely due to the particular time in which they are called up for training?—Some volunteers, of course, notify us that they cannot turn up in a particular period, and ask for authority to come up at a later period. We facilitate them as far as possible.

959. Chairman.—In our district the reason they do not turn up for training is that they have all gone to England. We have closed the Volunteer Hall. I was wondering if many men have dropped out of the Force in that way?—I am afraid some did, Sir.

960. Chairman.—In connection with sub-head Y (4), are these secretaries still functioning?—They are, Sir

961. And what are their functions?— One of their duties is supposed to see that men turn up for training, to see that they turn up for local training.

962. And if the men for whom they are responsible do not turn up, are they held accountable?—They cannot be held accountable. They get very little for their work—simply something to cover their expenses.

963. How many are there, do you remember, General?—I am sorry I do not really know.

964. It is not very important?—220.

965. The next item is sub-head A A— what is that. General?—That is the Military Tribunal.

966. With regard to Z—Appropriations-in Aid—I notice the very satisfactory fact that although you only anticipated to get £750 in show prizes the Army jumpers actually secured £1,473 3s. 1d.?—Yes. It is very hard to estimate that.

967. Very hard, but it is very gratifying to find that you got substantially more than was anticipated. In fact, they are paying more than half the expenses. Sub-head A (3) shows that the expenses of equitation teams at horse shows was £2,394 14s. 1d. The Appropriation-in-Aid is £1,473 3s. 1d.?—But the expenses referred to, Sir, merely cover the expenses incurred owing to the fact that we send them abroad. It does not cover their pay and allowances.

VOTE 66—ARMY PENSIONS.

Lieutenant-General P. MacMahon, called and examined.

968. Chairman.—In connection with Vote 66, there is a note from the Comptroller and Auditor-General as follows:—

Sections 8 (1) of the Military Service Pensions Act, 1924, and 20 (1) of the Military Service Pensions Act, 1934, provide for the abatement of pensions on a graduated scale while pensioners are in receipt of any remuneration, pension or allowance payable out of public moneys. In the case of pensioners to whom those sections applied and who claimed adjustments in respect of travelling and other expenses necessarily incurred in earning the remuneration, it was the practice to abate the military service pensions by the percentage appropriate to the net profits of the office. This procedure was not in accord with the recent decision of the Supreme Court on the application of the above-mentioned sections and it has been discontinued; but approximately £200 was overpaid in the financial year 1935-36, and £300 in the previous year. I am informed that it would be necessary to examine a very large number of payments to ascertain the total amount overpaid, and that the time and labour involved would not be justified as. in the opinion of the Law Advisers, the over-payments were made under a mistake of law and are not, therefore, recoverable. The Department proposes to seek the sanction of the Department of Finance to waive further consideration of this matter.

Has the Department of Finance sanction for that course been secured?—Yes, Sir.

969. Chairman.—I think we may regard that matter as closed and may return to the Vote. In regard to sub-head K—Military Service Pensions—I take it that this large sum less than what was granted was due to the fact that decisions have not been come to in the cases?— Yes, Sir.

970. Deputy Corry.—Is there any chance of speeding them up?

971. Chairman.—In connection with sub-head L—Extra-Statutory Grants— what exactly are these extra statutory grants?—They are set out on page 226. You will see there—

“(a) a person who, being the son of a Signatory to the Proclamation published on Easter Monday, 1916, has passed the statutory age limit for the receipt of allowances under the Army Pensions Act, received £150, and

“(b) a person who, being the daughter of the said Signatory, has passed the statutory age limit for the receipt of allowances under the Army Pensions Acts received £81 10s.”

They are the children of the late Thomas McDonagh.

972. Chairman.—These children, had they been minors, would have been entitled to certain allowances?—Yes.

973. And they had passed the age of 21 before this provision was made?—That is correct.

974. And an ex-gratia grant was made? —Yes.

975. In regard to sub-head O, have all these Connaught Rangers’ cases been determined yet?—Yes, Sir, they have.

976. They have all been settled?—Yes.

977. Deputy McMenamin.—There is no hope of any more of them?—Pardon?

978. There is no hope of granting any further pensions?—No; any person who has not got a pension will not get one. Some of them may apply for disability pensions but not for service pensions.

979. Chairman.—You had this immense surplus to be surrendered. We are waxing very eloquent on this Committee, General, on the subject of overestimation because we feel that these immense surpluses, such as are being surrendered by you on this Vote, constitute a standing invitation to other Departments to apply for Supplementary Estimates to be financed out of the surplus which you surrender and for which provision has been made in the Budget statement. So that, we exhort you to estimate as closely as possible even at the risk of having to come to the Dáil for a Supplementary Estimate, rather than to be piling up huge sums which you intend to surrender and which will, in fact, be swallowed up by some other Department which is less economical than you are.

Deputy Corry.—The greater portion of that surplus is under Military Service Pensions.

Chairman.—Yes, Deputy, but, of course, you remember that when these immense surpluses exist Budget provision is made for them.

Deputy Corry.—It is very hard to estimate closely.

Chairman.—Very. This is a matter which does require to be closely watched in order to avoid recurrence. If we have no other question to ask General MacMahon, I think we may let him go. We are very much obliged to you, General, for the help you have given us.

VOTE 54—LANDS.

Mr. M. Deegan, called and examined.

980. Chairman.—There is a note by the Comptroller and Auditor-General on this Vote—sub-head F—Solicitor’s Branch, Incidental Expenses—paragraph 58— which reads as follows:—

“Where proceedings for possession of land vested in the Land Commission have been taken under Section 19 of the Land Act, 1927, and an order for possession obtained, the Land Commission are entitled to recover from the person in default all costs and expenses incurred by them in connection with the issue and execution of such order. I observed in one case that the claim by the Land Commission for costs and expenses and also for interest on the purchase money from the appointed day to the date of obtaining possession was disallowed by the Judicial Commissioner as a charge against the purchase money of the estate, and that no steps were taken to recover from the person in default the amounts so disallowed. In another case it was observed that the full amount of such costs and expenses was not recovered.

“I have asked that the authority of the Department of Finance may be sought for writing off the amounts involved as irrecoverable.”

Have you any observations to make on that, Mr. Maher?

Mr. Maher.—Yes, Mr. Chairman. The authority of the Department of Finance has now been obtained in both cases referred to.

981. Chairman.—I take it, Mr. Deegan, that these were routine proceedings of a normal kind?

Mr. Deegan.—They were the result of a legal decision which was to the effect that these charges did not lie against the purchase money, and, in a new Act of Parliament which we hope will be introduced soon, we propose to put that matter right.

982. Chairman.—Paragraph 59 of the note by the Comptroller and Auditor-General—sub-head I—Improvement of Estates, etc.—reads as follows:—

“In my report last year I referred to the view expressed in paragraph 10 of the report of the Public Accounts Committee on the accounts for the year 1934-35, that the question regarding the extent to which the sanction of the Department of Finance was necessary, under Section 22, sub-section (3), of the Land Act, 1927, where expenditure improved vested as well as unvested lands, should form the subject of a discussion between the Department of Finance and the Land Commission with a view to arriving at an agreed basis. I have now been informed that, as a result of conference and correspondence with representatives of the Department of Finance, it is proposed to insert an agreed clause dealing with this matter in a new Land Bill which will shortly be introduced.”

Does this relate, Mr. Deegan, to cases where, let us say, a person goes in and asks you to deal with the making or the improving of a road, and you look despairingly at the applicant and say: “Well, this is vested land, and we cannot interfere, whereas, if it were unvested laud, we could deal with the matter”?—Well, Mr. Chairman, you are very close to it.

983. Are you going now to take discretion to carry out such works on vested land?— We have that discretion at the moment, subject to the concurrence of the Department of Finance, but the particular transactions that gave rise to this difficulty were cases in which vested and unvested lands were inter-mixed, and, according to the opinions of the Comptroller and Auditor-General, the Finance Department and the legal advisers, it would appear to be the case that, even if we spent one sixpence out of £100 on a vested holding which happened to be intermixed with unvested land, we would have to go to the Department of Finance for authority. We have agreed with Finance that, where the holdings concerned are substantially vested land, we go to them for authority, but where it is the other way about we carry on as before.

984. I take it, then, that all of us will be frantically trying to get our road to pass across some part of unvested land in order to get any improvements made?— Well, I do not want to give away too much information on that.

985. The note continues as follows:—

“With regard to advances made to certain tenant purchasers prior to February, 1935, in connection with a reclamation scheme, I observed that no repayments have yet been made, and that there is some doubt as to the validity of the undertakings to repay such advances. I am informed that the question of arranging for the repayment of these advances is under investigation.”

Has that investigation progressed, Mr. Deegan?—It is progressing, but, I am afraid, rather slowly. We are in correspondence with the Department of Finance, and we hope to get the matter settled eventually, but it is rather difficult and involved.

Mr. Maher.—It is a matter between the Department of Finance and the Land Commission, and we understand that the question of repayment is being considered.

Mr. Deegan.—That is right.

986. Chairman.—Is the Department of Finance pressing for it?

Mr. Codling.—Yes, we are keeping an eye on it, and we hope to get a reply from the Land Commission.

987. Would you agree, Mr. Codling, that one of the primary desiderata in the matter is to get these things out of the way?—Yes.

988. Chairman.—The note continues:

“In connection with the improvement scheme whereby certain lands in Co. Meath, available for the relief of congestion, were reserved for allottees from the Gaeltacht, expenditure of £46,390 14s. 11d. incurred in providing the necessary roads, drains and water supply, the erection of dwelling houses and out-offices and for free grants for stock and implements, is charged to this sub-head, and other payments amounting to £137 4s. 0d. are charged to sub-head X—Assistance to Migrants from the Gaeltacht. The total expenditure borne on the Vote for Lands in connection with the scheme from its inception in 1934-35 to 31st March, 1937, amounts to £73,010 8s. 3d. In addition, expenditure during the year of £584 1s. 4d. on the erection of a schoolhouse was subsequently recouped to the Land Commission by the Office of Public Works. The total expenditure on this schoolhouse to 31st March, 1937, amounted to £2,021 7s. 5d.

The remuneration of a domestic economy instructress, who paid periodical visits for the purpose of advising the migrants on matters of domestic economy, is charged to sub-head D (3) of the Vote for Gaeltacht Services (No. 56); and the salary of an Assistant agricultural overseer, who was appointed to give the migrants practical instruction in the development of their new holdings, is borne on sub-head I (3) of the Vote for Agriculture (No. 52).”

I take it that that is an informative paragraph?

Mr. Maher.—Yes, it is for the purpose of putting various matters under one head.

989. Chairman.—Do you happen to recollect, Mr. Deegan, how many migrants were provided for by this expenditure?

Mr. Deegan.—Up to the date of this report, 70 families.

990. So that it cost substantially more than £1,000 per family to get them settled on these holdings?—Yes. That would be the total cost, but it is rather unfair, if I might say so, to put it in that way, because this land would have been divided in any event, holdings created, houses built and so on, and the way we look at it is that the extra cost of this is in or about £320 or £330 per family.

991. That includes the remuneration of the domestic economy instructress and the agricultural overseers?—No. That would be in addition. The domestic economy instructress works in the West, but we ask her to come up for a few weeks at a time to help to give these people a start, to see that they keep their places clean, and so on.

992. The note continues as follows:—

“I observed that two of the migrants who returned to their old holdings in the Gaeltacht sold the stock which had been provided for them by the Land Commission. In reply to an inquiry I have been informed that steps have now been taken to prevent future migrants selling horses and implements so provided, but that it was not considered practicable to exercise a similar control over such stock as cattle and sheep.”

Deputy Smith.—Could you tell us, Mr. Deegan, how it is that these people could return to their holdngs in the Gaeltacht? I do not know whether it is the fact or not, but I was under the impression that. on leaving the Gaeltacht, they surrendered the holdings they had?

Mr. Deegan.—That is quite true, but they go back.

993. How could they go back to holdings they had already surrendered, and which, perhaps, had been given to uneconomic holders in that district?—In each case, the neighbours raised no objection. They simply went back to their holdings, and everybody resumed the status quo.

994. Is that a fact?—Yes.

995. Deputy McMenamin.—At that time, you had not disposed of the holdings these people had left?—We had actually given them under temporary agreements to the neighbours. In one case, I think, the house was already occupied, but the neighbours accepted the position. The position was that the wives went back and took possession, and the husbands followed.

996. Chairman.—You cannot protect the cattle and sheep?—Cattle, sheep, pigs, and hens must be treated on a special basis; they are bought and sold every day. In the case of the present migrants with whom we are dealing, we lend them the implements and the horses —there is a horse on loan to each. Implements and horses are on loan to the migrants, but in the case of cattle, sheep, pigs and hens, we must give them to the migrants.

997. The note continues as follows:—

“In my reports on the appropriation accounts for the years 1934-35 and 1935-1936 reference was made to paymasters whose duty it is to pay the wages of workers employed by the Land Commission, who are remunerated by way of a commission on the amount disbursed together with a percentage payment for travelling expenses, and to my inquiry as to whether, having regard to the increased expenditure on wages from this sub-head, the question of revising the scale of remuneration and the percentage payment for travelling expenses had been considered. I have now been informed that it has been decided to reduce the rate of commission payable as remuneration.”

Has that been done, Mr. Deegan?— Yes.

998. The next paragraph, No. 60—Subhead V—Payments under Section 18 (9) of the Land Act, 1933—reads as follows:—

“The charge to this sub-head, £5,090 11s. 6d. represents the loss of income certified as arising in the Church Temporalities Fund by reason of the operation of Section 18 of the Land Act, 1933, during the year under review. The accounts of the Church Temporalities Fund for the year 1936-37 have not yet been submitted for audit.”

Have they since been submitted?

Mr. Maher.—Yes, they have been submitted and certified.

999. Well, that matter is disposed of. Now we can turn to the Vote itself, on page 161. With regard to sub-head I, Mr. Deegan, is that the sub-head under which you would expend money on vested land in the event of determining to do so?

Mr. Deegan.—Yes—improvement of all estates, vested or unvested.

1000. With regard to sub-head O— Advances to meet payments under certain sections of the Land Act, 1931—is this a service that will eventually disappear?— Yes. Those various sub-sections of the Act of 1931, referred to there, have reference to alterations in purchase moneys due to certain resettlements of annuities. As re-sale comes to an end, this will come to an end also.

1001. And these would be in the nature of token votes, so to speak?—It was impossible to make an accurate estimate.

1002. With regard to sub-head AA— fees payable in connection with proceedings under the Land Act, 1933—what are these fees?—These are fees payable to the sheriff in connection with collection proceedings.

1003. And are these recovered from the people who are sued?—They are. You will find them in the Appropriations-in-Aid.

1004. Deputy McMenamin.—How do they compare with previous proceedings in connection with land annuities?—I do not think I have the figures with me.

1005. Chairman.—Well, I think, Deputy, we can raise that matter with the Minister in the House, if that course should recommend itself. I see, Mr. Deegan, that you realised sums substantially in excess of what you anticipated on foot of those sheriffs’ fees?

Mr. Deegan.—Yes. We got £5,000 more than we anticipated.

VOTE 55—FORESTRY.

Mr. M. Deegan further examined

1006. Chairman.—On this Vote there is a note by the Comptroller and Auditor-General in regard to sub-head C (2)— Cultural Operations, Maintenance, etc:—

“In my report last year I referred to the payment of mileage allowance to foresters for the use of their own bicycles and motor cycles on official business, in circumstances which would appear to require the payment of fixed allowances in accordance with general regulations. I stated that it was intended, after certain investigations had been completed, to submit the matter to the Department of Finance so that the position might be regularised. I have addressed a communication to the Accounting Officer asking to be informed of the present position.”

Have you received any reply to that, Mr. Maher?

Mr. Maher.—I understand the matter is with the Department of Finance.

Mr. Deegan.—Oh, no. It has been settled. New arrangements have been approved by the Department of Finance.

1007. Chairman.—And has a note on those new arrangements been sent to the Comptroller and Auditor-General?

Mr. Deegan.—Certainly. It should have been, from what I see here.

1008. Chairman.—And the matter has now been disposed of?

Mr. Maher.—Yes.

1009. Chairman.—The note by the Comptroller and Auditor-General continues as follows:—

“I observed that labourers employed at a forest were paid a full day’s wages, although only a half-day’s work was performed on the day in question, and that such payment did not seem to have been made in accordance with the Forestry Service Regulations regarding the grant of a half-holiday with pay. I am in communication with the Accounting Officer on the matter.”

Has anything further transpired, Mr. Maher?—Yes. We have had a reply. The position as I understand it, Mr. Chairman, is that at the time this matter was raised we were not aware that a later regulation dated June, 1937, would cover this point.

1010. The matter is now in order?— Yes. If a similar position arose now it would be in order, because we understand that a regulation was issued in June, 1937, which provided for a half-day’s pay in the circumstances in which the matter was raised in March, 1937.

Mr. Deegan.—I think the position is this: The half-day referred to there was a Saturday, and following that Saturday there was a snowstorm which lasted nearly a fortnight. The rule under which the Forestry Department were working— and had been working for 30 years or so—would have given a full day’s pay if the succeeding five days of the pay-week had been worked. The succeeding five days of that week were not worked on account of the snowstorm. At the same time, it would have been an exceedingly harsh thing if the men did not get their usual full day’s pay. The new rule to which Mr. Maher has referred calls for three full days’ work in the same week before a man would qualify for a full day’s pay on Saturday.

1011. Chairman.—So even under the new rule it would have been an irregular payment?—Well, we would probably have been queried on it.

1012. Deputy Smith.—Mr. Chairman, would it be unreasonable to ask Mr. Deegan to explain how it is that forestry workers are not in the same category regarding holidays with pay as other workers in similar employment?

Mr. Deegan.—I do not think I have all the facts on that at my finger-ends at the moment, but I know that forestry workers have some special rules and regulations, just like this one, applicable to themselves. Their conditions have always been regarded as somewhat different to those of, say, Land Commission workers and others. They work long distances from home, in mountains and valleys, and they have some special rules and regulations.

1013. I have tried on a few occasions to find what I would regard as a legitimate reason for failure to put them on the same basis as, say, Land Commission workers in regard to holidays, and I must say I have never met anybody who was able to give me a convincing reason as to why that should not be done?—Their conditions and rules vary with the different districts, too.

1014. But as to the nature of the work. I do not know how you can distinguish it from the nature of the work done by a number of other workers?

Chairman.—Is it your view, Deputy, that the regulations relating to forestry workers are less advantageous than those of agricultural workers, or do you think they are more advantageous?

Deputy Smith.—Well, of course, if you insist on placing them in the same category as agricultural workers I might as well, or the Department might as well, say that Land Commission workers should be in the same category, too. I am not arguing on the basis that the forestry worker is in a worse position than the purely agricultural worker. What I am contending is that he is in a worse position as regards holidays than other workers employed by the State on what seems to me similar work.

Mr. Deegan.—My recollection is that the rules in regard to Church holidays and so on vary with the different districts. There are local rules applicable. In some places the men work on Church holidays, while in other places they do not. In other cases, too, they arrive an hour or so late on Church holidays. We have got to work in with the local rule.

1015. Deputy Smith.—But suppose an estate is being divided by the Land Commission and men are engaged for a period of, say, 12 months. On its flank you have an estate being developed by the Forestry Department and men are engaged there too on largely similar work. The men employed by the Land Commission are getting holidays with pay under the Conditions of Employment Act. I am not sure if that is the Act under which they get them. At any rate, they get holidays with pay, while the workers engaged by the Forestry Department get no such facilities.

Mr. Deegan.—Is there anything in the law relating to that?

1016. Deputy Smith.—I do not know, but I should like to have information on the matter, because I think there is an injustice there.

Mr. Deegan.—I think, Mr. Chairman, that Forestry employees are outside the Conditions of Employment Act.

1017. Chairman.—Deputy Smith is conce with detailed information on the subject, and if it would not be too much trouble I should be much obliged if you would let us have details distinguishing the conditions of employment of forestry employees as opposed to those of the Land Commission workers.

Mr. Deegan.—It is no trouble at all.

Chairman.—Then Mr. Deegan will give us a note* containing the relevant information.

1018. The Comptroller and Auditor-General’s note continues:

“The Forestry Service Regulations, which have been in operation for a number of years, provide, inter alia, for the payment of wages for wet days or half-days in all cases where labourers attend for work at the appointed time and remain at the disposal of the Forester as long as they are required. The question of amending the Regulation regarding the payment of wages for time lost owing to weather conditions is the subject of discussion with the Department of Finance. It appears that, out of a total of £75,863 expended on labour during the year 1936-37, the sum of £5,483 represented wages paid to labourers during periods when, owing to weather conditions, no work was performed.

Mr. Maher.—For the purpose of that paragraph I should like to call attention to the large figure of £5,000 odd referred to in the second last line. We understand that that matter is the subject of correspondence with the Department of Finance.

Mr. Deegan.—It has been settled. As regards the large figure of £5,483 for the year 1936-37, I should say that that was a particularly wet year. In ordinary years we would not have, I think, within £2,000 or certainly £1,500 of that. The matter of the rule governing payment for wet days has been settled with the Department of Finance, and it allows payment where the labourers attend and are at the Forester’s disposal for alternative work as long as required. If there is not alternative work available, and if it looks that normal work will not be possible in the afternoon, the men should not be retained but should be paid for the half-day.

1019. Chairman.—And a note of that agreement is being, or has been, sent to the Comptroller and Auditor-General?— It should have been sent to him.

1020. And if it has not, it will be?— Yes.

1021. The Comptroller and Auditor-General has the following note in regard to the Grant-in-Aid for the Acquisition of Land:—

“The expenditure from this fund includes a payment of £10 to the seller of certain land after the deed of assignment had been executed, and the Department had taken possession of the land. This payment would appear to have been made as an act of grace and I have requested that the covering sanction of the Department of Finance may be sought for the expenditure. In another case it appears that a contract was entered into for the purchase of lands of a certain area, but the area actually assigned to the Department was less than that stipulated in the contract. As no claim for refund of a proportionate part of the purchase price was made I have also asked that this matter be referred to the Department of Finance for covering sanction.”

First of all, with regard to the payment of £10, has that been sanctioned?

Mr. Deegan.—We have got sanction from the Department of Finance for that.

1022. Deputy Smith.—It is not a very big sum, but can you tell us what is the idea behind it?—The case is a very simple one, and it may not be any harm to give details just to show what we are up against at times. We bought 59½ acres for £250. The redemption value of the land purchase annuity on that came to £189, and there were arrears of annuities and rates also due, with the result that the owner—a widow with three young children—had only £16 13s. 8d. for herself.

1023. Chairman.—For 50 acres of land? —For 59½ acres of land.

1024. Deputy Corry.—Of forestry land? —Yes. The settlement of the case took several months, and an appeal was made to us; we raised our price by £10. We did that without going to the Department of Finance for sanction, but we have now obtained their sanction.

1025. Deputy McMenamin.—In the case of a widow who owns land, and who has reached an age when she is no longer fit to work it, you send in an inspector making an order to resume the lands, and they are ultimately resumed?

Mr. Deegan.—You are speaking of the Land Commission now?

Deputy McMenamin. — Yes. If the redemption money was very high, as a result the widow might have nothing to get, and be turned out practically penniless. Has the Department when resuming in cases like that considered the consequences?

Chairman.—That is clearly an expression of policy which the witness cannot answer.

He is the witness for the Department? —He is here as Accounting Officer, and that is clearly a question that should not be asked.

1026. Deputy Smith.—Would it be in order to ask if this widow had any other land after she had disposed of this land? —I could not say. I have no information about that, but £260 for 60 acres of forestry land is an excellent price.

1027. Deputy McMenamin.—Yes, for the Forestry Department?—We do not purchase good land for forestry. That is the top price for that class of land.

1028. Chairman.—When you say that £260 is an excellent price for nearly 60 acres of forestry, you almost carry conviction, but when you redeem the annuity, and when the matter is wound up the owner gets £16 13s. 8d. I am not sure that it is a good price for land. I agree with you that it is not a matter about which I should ask you at this Committee and I do not propose to question you about it. The note also refers to a contract that was entered into for the purchase of land of a certain area, but the area actually assigned to the Department was less than that stipulated, and there was no refund of a proportionate part of the purchase price. Has the Department of Finance sanctioned that transaction?

Mr. Maher.—I have not yet received the sanction of the Department of Finance in this case, and I am not aware if the Land Commission has received it?—We have been in correspondence with the Department of Finance. They told us that we should get back the value of the land, £5, from the man who purported to sell it. We wrote to him, but get no answer.

1029. The matter is proceeding?—Yes. This was a case where a man honestly thought he had two acres of land for sale, and even the documents dealing with title showed the land in the area, but the actual property was two acres of water. This man thought he owned two acres on the other side of the water. It was a genuine error.

1030. Does the land belong to a neighbour?—Yes.

1031. When he dies, probably a very nice question of law will arise?—It was a genuine mistake. We have asked for the £5 but we did not get any answer.

1032. Does sub-head E (2)—Exhibits at Shows—include the exhibit at the Royal Dublin Society?—Yes.

1033. The exhibit there was of great value. It was one of the best exhibits in the Show?—Yes.

1034. Deputy Smith.—Arising out of sub-head E (1)—Forestry Education— has the number of trainees increased?— We take in one dozen each year. We have 21 in residence at Avondale at present. They spend the first and third years there.

1035. Chairman.—Is it by examination you admit pupils to Avondale?—Yes.

1036. Is it a competitive examination? —Yes, conducted by the Civil Service Commissioners.

1037. Is it a qualifying or a competitive examination?—Competitive.

1038. The reason I ask is that I knew a pupil who went up for the examination and passed, but was not called, and I was wondering if he would be called subsequently if a vacancy occurs, or is it that only the best boys each year are called? —The first 12 nominated by the Civil Service Commissioners are called if they pass the health test and the character test.

1039. And the following year fresh examinations are held?—Yes.

1040. And any candidate not called as a result of the examination must present himself again?—I think so.

1041. Deputy Smith.—Is there not an oral test and interview at which some who succeed in the written test fail? I know a boy who passed the written test, but failed at the interview. I understand pupils have to take first place at the written and oral examinations?— Nobody should have that information. It is not possible to say if a candidate passed the written or oral tests. Nobody but the Civil Service Commissioners would know that.

1042. It was from a letter that I saw with one of the applicants I learned that? —I do not think that information should be known. I would be surprised if it was known. Certainly we do not know it.

1043. Chairman.—It is obvious that as a result of the examination the 12 who pass are called, and the others must go up for examination again?—Exactly. It is the ordinary competitive Civil Service Examination

1044. Deputy McMenamin.—I take it that you are keeping in mind the desirability of not training too many, so that they will not be unemployed?—There is no possibility of that at present.

1045. Chairman.—Sub-head F—Agency and Advisory Services—Is it contemplated advising individual citizens about trees on their property?—No.

1046 What exactly does this sub-head deal with?—It is a token vote in case we want to get outside advice.

1047. Chairman.—Sub-head G—Incidental Expenses:—I should like to draw attention to the fact that while a great deal of money is provided for Forestry, I am wondering if it occurred to the Department that more damage is being done by ivy climbing up trees that are growing than is being replaced by the planting done by the Forestry Department. If the Department would concern itself with that, and send around somebody to cut the ivy off trees that are being strangled by it, it would be doing valuable work.

Deputy Corry.—I agree.

Chairman.—All the trees killed by ivy are hardy trees that took centuries to reach maturity, whereas the others are immature. I throw out that pearl of wisdom in the confidence that it is being thrown to worthy people?—It will be considered.

VOTE 56—GAELTACHT SERVICES.

Mr. M. Deegan further examined.

Paragraph 63 of Comptroller and Auditor-General’s Report:—

Sub-head E.3.—Kelp, etc.

“I observed that a contract for the sale of ground kelp was entered into on the basis that the payment to be made would be regulated by the iodine content of the kelp. During the continuance of the contract the buyer expressed dissatisfaction with the grinding of the kelp, and also intimated that the iodine content, upon which the price was based, was too high for his purposes. After negotiations the Department agreed to allow the buyer 10/- per ton for the purpose of having the kelp reground by him, and also to reduce the price per ton when the iodine content of the kelp exceeded 0.8 per cent. The value of these allowances amounted to £361 10s. 0d. The Department of Finance was subsequently informed and covering sanction obtained.”

1048. Chairman.—I am well aware that the difficulties of the Department in connection with the sale of kelp are so immense that the sanction of the Department of Finance should be obtained for this payment. I do not think we have anything further to say on that.

Paragraph 64 of Comptroller and Auditor-General’s Report:—

Sub-head H.3—Grants under the Housing (Gaeltacht) Acts, 1929 and 1934.

“In previous Reports reference was made to the grants and loans which may be made under the Housing (Gaeltacht) Acts, 1929 and 1934, and to the fact that the aggregate amount of such grants and loans is not to exceed the sum of £650,000.

“I am informed that at the 31st March, 1937, the position regarding such grants and loans was as follows:—

1049. There is nothing abnormal in the difference between the amount of grants sanctioned and payments?— That was to be expected. We have the same experience in the Land Commission.

1050. There was no undue delay?—No.

1051. Are all applications for grants under the Gaeltacht Housing schemes covered to date? Is there any accumulation of arrears?—No serious arrears.

1052. You may remember that the arrears in that respect were terrifying some years ago?—They were heavy. A special staff of housing surveyors was recruited and they have the work pretty well up to date now.

1053. Have you any idea of the approximate time that elapses between the filing of an application for a grant or loan and the time when the proposition is completed?—No.

1054. Deputy McMenamin.—My experience is that the period is a reasonable one.

Paragraph 65, Comptroller and Auditor-General’s Report:

Sub-head I.—Appropriations-in-Aid.

“Difficulty has been experienced by the Department in dealing with the question of insurance deductions from the wages paid to employees in Rural Industrial Centres, due mainly to the fact that both inworkers and outworkers are remunerated on the basis of piece-work rates. I observed that in many cases incorrect deductions had been made from the wages of the workers in respect of the contributions due by them, with the result that the vote has been called on to bear, in addition to the employer’s contribution, portion of the employees’ contribution. The Department of Finance has been informed of the position and its covering authority sought for the charge to the vote of sums under-deducted from the wages of insured workers. The charge has been offset by the retention of sums over-deducted but such over-deductions will, in accordance with the National Health and Unemployment Insurance Acts, fall to be repaid to the workers concerned.”

1055. Mr. Maher.—This is a very difficult matter but, I understand, it has been discussed between the two Departments, and very likely a satisfactory arrangement will be come to?—It has been arranged. The arrangement has been approved of by the Department of Finance, and refunds made to the workers. The new regulations are working satisfactorily.

1056. Chairman.—Has a note concerning the new regulations been sent to the Comptroller and Auditor-General?—I cannot say. If it has not been sent, it is going to be sent.

Paragraph 66, Comptroller and Auditor-General’s Report:—

Industrial Loans.

“I have been furnished with a schedule concerning the Industrial Loans from which it appears that advances made during the year ended 31st March, 1937, amounted to £32. Of this sum £12 represents the value of looms, machines, etc., issued on loan repayment terms, while looms valued at £20 were issued to workers on hire purchase agreements. The sums due under these hire purchase agreements are recoverable by deduction of a percentage of the earnings of the hirer in the production of goods for the Department. Exclusive of the amounts due under these agreements arrears due at 31st March, 1937, amounted to £9,547 18s. 5d., as compared with £9,519 5s. 9d. on 31st March, 1936. Included in the arrears outstanding at 31st March, 1937, is a sum of £9,383 10s. 6d. due by a company which ceased to exist in 1925. I understand, however, that negotiations are in progress for the realisation of such security for the debt as the State holds.”

1057. Chairman.—This is an old C.D.B. loan?—Yes. It is dated 1910. It began at £7,000 and it has mounted.

1058. Have you made up your mind to wind up the transaction?—Negotiations are in progress for the sale of our interest in the property, and when we succeed in selling it, as we hope to, the transaction will be closed.

1059. Is the purchaser intending to carry on?—I am afraid not.

1060. I suppose the demand for stones is not as great as it was before the introduction of cement and reinforced concrete? —That particular company, anyway, seems to have come to an end.

1061. I suppose the Department of Industry and Commerce will be consulted before it is finally abandoned?—The company has been finally abandoned for years. It ceased operations in 1917 and it has been dissolved since 1925. All we can do is to try to realise something out of what is left.

1062. As to sub-head D 6, I see there is a substantial increase, which is attributed partially to an increase in the cost of woollen yarn. Did that arise from the fact that the woollen yarn used is manufactured in this country?—The bulk, I am told, is manufactured outside the country and imported.

1063. Then this represents, in fact, the tariff imposed upon it?—We import under licence.

1064. I wonder how the prices went up. Of course, we are now dealing with two years ago, and prices would be advanced two years ago?—That is two years ago, and there must have been a rising market.

1065. As to sub-head E (3), the kelp industry seems to be lagging?—It is very poor.

1066. Deputy McMenamin.—What is it this year?—1,000 tons, I am told.

1067. For the entire coast?—Yes.

1068. Chairman.—With regard to sub-head HH3—what are the terms under which you make a loan for the erection of a henhouse in the Gaeltacht?—There are very few loans, but there is a grant of a small amount—£4 or £5. We can give a loan up to the same amount, but there are very few loans. They are practically all free grants.

1069. We have been pressing the Minister for Agriculture to give loans for the erection of henhouses in the rest of Ireland and the scheme eventually given birth to provides for loans of £25 at 5 per cent. interest to be paid in four years. I cannot imagine anyone borrowing it on these terms and I was wondering what your experience was in the Gaeltacht?—Our experience is that the people are not taking loans. They are taking the free grant of £5 for poultry houses and £5 for a piggery.

1070. Deputy McMenamin.—You combine that with the grant for the house? —Yes.

1071. Chairman.—As to sub-head I, carrageen seems to be going overboard too?—We are not doing anything in carrageen except the food carrageen—the carrageen that is sold in packets.

1072. Deputy McMenamin.—You had an exhibit at the Glasgow Exhibition; how did it turn out?—There was a very good demand for samples and the better the demand for samples the more likelihood there is of orders later on.

1073. Is that being followed up by seeking orders?—That would be a matter for the wholesale agent. We sell the carrageen through a wholesale agent and he is responsible for attending to it.

1074. Chairman.—Note (2), on page 173, in reference to the Appropriations-in-Aid, referring to the sale of kelp, says: “Deficiency due to a much less quantity of kelp being available for purchase and subsequent sale than anticipated, modified by increased price realised consequent on the grinding of the product for the purchaser.” Is the price of kelp improving?—Perhaps you will let Mr. Mac an Bháird answer that, as it is a technical question.

1075. Mr. Mac an Bháird.—The Estimate was made on the basis of the sale of raw kelp, you might say. Actually, there was some kelp ground. We had additional expense in connection with the grinding of the kelp and got an increased price.

1076. Does it appear that there will be any market for any substantial quantity of ground kelp?—There is a market for at least 1,000 tons, probably more, if we could get it.

1077. Can you give a remunerative price for kelp on the basis of selling it ground? —That is the trouble. Taking into account the expense of grinding it and the expense of selling it, and of collection, we cannot get very much more than £6 to £6 5s. per ton for ground kelp.

1078. If the people were content with what that would yield for wet kelp there is a larger market than is at present being supplied?—Yes.

1079. What would that approximately yield for wet kelp, that £6 5s. for ground kelp?—Between £3 and £4 per ton, as bought from the gatherers.

1080. Burned kelp?—Yes.

The witness withdrew.

The Committee adjourned.

*See Appendix X.

*See Appendix XI.